Tuesday, July 05, 2011

The Sun Also Sets

For years, Americans living in other parts of the United States have had a love/hate relationship with the Golden State. California was like the rich uncle who showed up at the family reunion looking tan and fit with a new sports car and a babe of the month on his arm. He was so cool, successful, and impossibly happy that it was difficult not to like him. But there was also an undercurrent of jealousy and resentment. There were whispers about “unsustainable lifestyle” and “what comes around goes around” and an unstated desire to see it all come apart. This explains why so many disaster movies were set in California. They were a vehicle for the rest of America to satisfy our need for a little state Schadenfreude. Same with the jokes and comments about California one day falling into the ocean.

But now that the day of reckoning has arrived, I doubt if there’s much joy to be had. Today, California is no longer cool. The rich uncle is broke and works at Wal-mart as a greeter to make ends meet. He’s wrinkled, flabby, drives a used Neon, and on most days wears Depends. Yet he still thinks he has “it” without realizing that “it” is far more likely to be found in places like Texas and North Dakota (yes, really) these days. He’s both pathetic and pitiable in his current state yet few of us feel the urge to unleash a well-deserved Nelson Muntz “haw haw” at his expense. For while we may not subscribe to the view that what’s good for California is good for the country, we understand that in the long run California’s current woes are not good for anyone.

What happened? All of California's natural assets are still in place. Its climate is as benign, its resources as abundant, its agricultural productivity as great, its infrastructure as developed. The answer lies, as it so often does in the human history of decline, in politics.

While the millions who migrated to California over the last century and a half did so in order to get rich, their descendants have increasingly erected obstacles to new wealth creation. The environmental movement was largely born in California, with John Muir and the Sierra Club, but it now threatens to strangle the state's economy in a laocoön of regulations. The state's vast oil and natural gas potential on the continental shelf has been off limits for years. Environmental groups and others have become masters at tying up economic development in court.

Non-environmental regulations have mushroomed as well. It can take months to obtain permits to open even the simplest business. Is it any wonder that the state's unemployment rate, 11.7%, is one of the country's highest?

An ever-growing political class, largely funded by public service unions, has hugely increased the size and cost of government. California now has among the highest tax rates in the country but also the greatest budget deficits.

California can come back. This most blessed and diverse of states has so many advantages. But it will not recover—indeed will continue to decline—as long as its politics remain so benighted.

Of course California can come back. The question now is a matter of will.